State Signs Deal to Develop Geothermal Energy at Mount Augustine Volcano

The State of Alaska signed a memorandum of understanding on May 18, 2026, with POSCO International Corporation to develop geothermal energy and green methanol production at Mount Augustine, one of Alaska's most active volcanic systems in Cook Inlet.

The agreement, signed by Governor Mike Dunleavy and POSCO International President and CEO Lee Kye-in, covers six development projects across Alaska. The agreement is exploratory only: it creates no binding financial obligations and establishes a framework for information exchange and future negotiations over the next two years. Two projects focus on Mount Augustine: extracting geothermal resources from the volcano and using that energy to produce green methanol as a clean fuel source.

Mount Augustine sits on an uninhabited island in lower Cook Inlet.

"Alaska is open for business, and this agreement reflects the world-class investment opportunities our state offers," Governor Dunleavy stated. "POSCO International is a global leader, and their interest in Alaska validates what we have long known: our resources, our geography, and our people position us for extraordinary economic growth. This is the kind of partnership that creates jobs, grows our economy, and secures Alaska's future."

Lee Kye-in stated the memorandum marks an important step in building a long-term partnership. "Alaska's abundant resources, strategic location, and strong development potential are closely aligned with our global capabilities in energy, infrastructure, and critical minerals," Lee stated. "We look forward to working closely with Governor Dunleavy and the State of Alaska to explore these projects responsibly and create meaningful opportunities that can help strengthen supply chains and support sustainable growth for both parties."

POSCO International Corporation is an international trading and investment company headquartered in Seoul, Republic of Korea, with global operations spanning energy, mobility, and sustainable infrastructure development.

The other four projects in the agreement include a sustainable aviation fuel refinery at Point MacKenzie on the Matanuska-Susitna Borough's deep-water port corridor; development of the Bokan-Dotson Ridge rare earth element deposits on Prince of Wales Island in Southeast Alaska; expansion of Port MacKenzie terminal infrastructure; and advancement of the Knik Arm Crossing and Expressway linking Anchorage and the Mat-Su Valley.

Under the terms of the memorandum, the state and POSCO International will explore frameworks, exchange information, and negotiate formal definitive agreements on any or all of the six project areas. The agreement is effective for two years.

The state described the Bokan-Dotson Ridge site as one of the most significant rare earth element deposits in the United States. Rare earth elements are critical for electronics, defense systems, and renewable energy technologies.